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V.S.A. Arumuga Mudaliar Vs. V.S.P. Balasubramania Mudaliar and ors. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtChennai
Decided On
Reported inAIR1945Mad294; (1945)1MLJ463
AppellantV.S.A. Arumuga Mudaliar
RespondentV.S.P. Balasubramania Mudaliar and ors.
Cases ReferredSubbarajxt v. Venkataramaraju
Excerpt:
- - the second defendant was apparently satisfied with this decision as he has not appeared to support the appeal filed by the seventh defendant 4. in subbaraju v. if an agreement to abide by the decision of an arbitrator can be held to be a compromise, the section is clearly applicable......that a mere agreement to he bound by a future award is not a compromise, whereas an agreement to accept an award that has been made is a compromise. it is difficult to see on what principle parties who agree to accept a certain fixed sum in satisfaction of a claim can be said to compromise that claim, whereas if they agreed to accept a sum whieh is to be fixed by some one else that does not amount to a compromise.7. there is here clear indication that an agreement to accept a future award can be treated as a compromise in the suit, and in our judgment the arbitration act of 1940 in no way alters the position.8. the appellant was a party to all that happened before the subordinate judge. he was a party to the agreement under which sir r.k. shanmugham chettiar was to settle the.....
Judgment:

Alfred Henry Lionel Leach, C.J.

1. These two appeals arise out of an order passed by the Additional Subordinate Judge of Coimbatore on the 23rd November, 1942. No. 269 of 1943 is an appeal against the order itself. No. 213 of 1943 it against the deceree which followed the order and has been filed by the appellant ex abundanti cautela. For reasons which we shall state both the appeals must be dismissed.

2. The appellant is the seventh defendant in a suit for partition of joint family property. The plaintiff is the first respondent. There are altogether fifteen defendants, but only defendants 1 to 8 are really concerned with the suit. The plaint was filed on the 22nd Novemb3r, 1940. In 1942 a settlement was contemplated and in order that it might be brought about, the Court granted several adjournments. On the 31st August, 1942, it was reported that the seventh defendant had consented 'to settle matters' and at his request the case was adjourned until the 7th September, 1942. After the two further adjournments, it was reported to the Court that Sir R.K. Shanmugham Chettiar was 'settling the matter'. On the 5th September, 1942, the plaintiff and defendants 1 to 8 had in writing agreed to refer the matters in dispute to the arbitration of Sir R.K. Shanmugham chettiar. the agreement contained thease statements:

In this suit we consented before the Sub-Judge to abide by the decision or award to be passed by you. Therefore we all of us agreed to abide by the decision or award to be passed by you in this matter and we bind ourselves to file the award in the suit in Court and to obtain a decree in terms thereof.

The document was in Tamil. The translation given here is that made by the Sub-ordinate Judge. The translation to be found in the printed documents is not accurate.

3. In accordance with the agreement, the arbitrator embarked upon the inquiry and on the 7th November, 1942, after hearing the parties, he gave his decision, whereupon the plaintiff and the third defendant applied to the Court to pass a decree in terms of the award. The second and seventh defendants objected. They did not contend that the arbitrator had acted in any way improperly or that the award was invalid. They objected to certain of the directions given and wanted them to be changed. The Subordinate Judge held that the parties ware bound by their agreement and passed a decree in terms of the award. The second defendant was apparently satisfied with this decision as he has not appeared to support the appeal filed by the seventh defendant

4. In Subbaraju v. Venkataramaraju : AIR1928Mad1025 , a Full Bench of his Court held that an award made in a private arbitration during the tendency of the suit could be treated as an agreement for compromise and on that basis a decree could be passed in the term of the award Mr. K.V. Ramachandra At on behaIf of the appellant, concedes that if the Arbitration Act of 1940 has not effected an alteration in the law, the judgment of the Full Bench will govern this case, which means the dismissal of the appeals. He says, however, that Section 47 of the Arbitration Act precludes an award in a private arbitration being made a decree of the Court unless all the being passed in the terms ther of. Section47 reads as follows:

Subject to the provisions of Section 46, and save in so far as is otherwise provided by any law for the time being in force, the provisions of this Act shall apply to all arbitrations and to all proceedings thereunder;

Providing that an arbitration award otherwise obtained may with the consent of all the parties interested be taken into consideration as a compromise or adjustment of a suit by any court before which the suit is pending.

Section 46 has no application here and therefore we do not need to set out its pro visions. We are merely concerned with the proviso in Section 47 which plainly indicates that an arbitration award obtained otherwise than under the Act may with the consent of the parties interested in it be regarded as a compromise of a pending suit. There is nothing in the proviso which precludes antecedent consent.

5. Order 23, Rule 3 says that Where it is proved to the satisfaction of the Cpurt that a suit has been adjusted wholly or in part by a lawful agreement or compromise, or whefe the defendant satisfies the plaintiff in respect of the whole or a, part of the subject-matter of the suit, the Court shall order the agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far as it relates to the suit. The proviso to Section 47 leaves this provision of law untouched. In fact it would appear to be likely that it was inserted by the Legislature in order to allow the Court unfettered action under Order 23, Rule 3.

6. The judgment in Subbaraju v. Venkataramaraju : AIR1928Mad1025 itself gives the answer to Mr. Ramachandra Aiyar's argument. It contains this statement:

If an agreement to abide by the decision of an arbitrator can be held to be a compromise, the section is clearly applicable. It has been suggested that a mere agreement to he bound by a future award is not a compromise, whereas an agreement to accept an award that has been made is a compromise. It is difficult to see on what principle parties who agree to accept a certain fixed sum in satisfaction of a claim can be said to compromise that claim, whereas if they agreed to accept a sum whieh is to be fixed by some one else that does not amount to a compromise.

7. There is here clear indication that an agreement to accept a future award can be treated as a compromise in the suit, and in our judgment the Arbitration Act of 1940 in no way alters the position.

8. The appellant was a party to all that happened before the Subordinate Judge. He was a party to the agreement under which Sir R.K. Shanmugham Chettiar was to settle the differences between himself and the other members of the family and he does not suggest that the award is in any respect unlawful. He agreed to compromise the suit on the terms of the award to be given by Sir R.K. Sha'nmugham Chettiar and as the case falls within the decision of the Full Bench in Subbarajxt v. Venkataramaraju : AIR1928Mad1025 he must be held to his agreement. Of course, a party cannot be compelled to accept an award which is unlawful. The agreement to accept an award yet to be made presupposes that it will be a lawful award. Here the award is a lawful one.

9. The appeals are dismissed with costs in C.M.A. No. 269 of 1943. We fix the Advocate's fee at Rs. 100.


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